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Don't tell Lita Sciturro-Smith retail real estate is dying.
The investor, whose family has been in commercial real estate since the 1970s, has been patiently, and prudently, buying a series of income-producing retail-focused properties in the Sarasota-Manatee-Charlotte region for close to a decade. Her attitude toward the bogeyman of brick-and-mortar — e-commerce — is to build up a portfolio of tenants in service industries, including restaurants, gyms, hair salons and nail salons. “People always need services,” she says.
Sciturro-Smith and Sam Sciturro, her father and business partner, made their first retail acquisition in Florida in 2010, purchasing Allris Plaza in Parrish, north Manatee County. In Port Charlotte, they purchased a strip center, Port Charlotte Retail, in 2011. They also own a professional park in Osprey, Mediterranea Professional Park, purchased in 2013. The office park is somewhat of an outlier in their portfolio focusing on shopping centers, she says.
Their latest acquisition, earlier this year, is The Shoppes of Heron Creek in North Port, a 15,600-square-foot retail center with Beef ‘O’ Brady’s, Great Clips and Jet’s Pizza among the tenants. North Port, in south Sarasota County, is home to one of the fastest-growing master-planned communities in Florida, the West Villages.
Moving forward, the duo wants to add additional retail properties to their portfolio. “If we see something we like at a fair price, we’ll move on it,” Sciturro-Smith says. She adds they decided to focus on the retail side of commercial real estate because of higher prices per square foot.
With specific property attributes they’re looking for in their search for the ideal investments, it can take a long time to identify the right opportunities, she says. But the wait is worth it.
Larry Richards, with Optimus Commercial Real Estate Investment Advisors, has been working with them since he was the listing broker on Allris Plaza in Parrish. Then he worked with them to find their next properties.
Richards finds potential opportunities for them by using multiple databases and searching for certain criteria, such as price range, size of property and location. When Richards finds options, he puts together a report that includes vacancy rates, demographics, sales volume history and recent buyers and sellers.
He says he sends them an opportunity about every two or three months. “I don’t waste their time with things that just aren’t going to work,” Richards says. “I do a lot of the screening. Sometimes there’s nothing out there that’s really suitable.”
“We believe that all of our tenants should have the ability to complement one another.” — Lita Sciturro-Smith, commercial real estate investor
Sciturro and Sciturro-Smith, who provides hands-on management of the properties, purchased The Shoppes of Heron Creek in February. The paid about $2.9 million for the property. “It fits our model for properties,” she says. “It was also in the right location and aligned well with our other locations.” The center is on the Interstate-75 corridor, a key benefit. “It’s easy for us to get to all of our properties quickly and efficiently,” she says.
Sciturro-Smith says that old real estate saying — “location, location, location” — applies to their commercial real estate investments. But there are additional factors that play into the selection. “We typically look for properties that are newer construction with a higher cap rate,” she says.
They look at the size of the properties, too. Their investments range from 5,000 to 35,000 square feet. Also making the list of considerations is ease of access into the properties, building aesthetics and types of tenants. “We believe that all of our tenants should have the ability to complement one another,” she says. “If one drives traffic to the plaza, there’s potential for others to gain more business.” It works like this: someone may come to get a haircut and decide to get some pizza, too, and then get a manicure. “A good tenant mix is crucial,” she says.
Then they factor in how she and her father interpret the value of the property. She says when she and her father consider making an offer, he has his own methodology for evaluating the price. “When he looks at something, he is able to calculate what the offering price would be based on what the return would be in a specific period of time,” she says. “It’s industry standard, but it has a different spin.”
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